Simply Inc. (SIMPQ)

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InfoSonics Reports First Quarter 2017 Results

SAN DIEGO, May 11, 2017 – InfoSonics Corporation (NASDAQ: IFON), the provider of verykool® wireless handset solutions and tablets, today announced results for its first quarter ended March 31, 2017.

“It was an extremely challenging quarter,” said Joseph Ram, President and CEO of InfoSonics. “The Chinese New Year fell in the middle of the quarter, which caused delivery delays from our suppliers, in addition to generally soft sales channels that were still clearing promotional inventories from year end. Although operating expenses were down 27% from the prior year, we still sustained a significant loss. In this competitive environment, we are taking actions to further reduce expenses, improve our operating efficiencies and product pricing and refine our product offerings.”

Net sales for the first quarter of 2017 amounted to $6.2 million, which represented a $3.2 million, or 34%, decrease from $9.4 million for the first quarter of 2016. The decrease reflects a lack of sales to carrier customers in both Central and South America, as well as our exit late last year from the U.S. market. These declines were partially offset by increased sales to Miami-based distributors selling to Latin America retailers.

Gross profit in the 2017 first quarter was $322,000, a 73% decrease compared to $1,178,000 for the first quarter of 2016. Our gross profit margin as a percent of sales in the 2017 first quarter decreased to 5.2% compared to 12.5% for the 2016 first quarter. These reductions were caused by price discounts given to customers in a challenging market, price protection given to certain big box retailers in order to promote sell-through, and the overall low level of sales that made it difficult to absorb fixed overhead costs.

Operating expenses in the first quarter of 2017 were $1,362,000, a 27% decrease compared to $1,857,000 in the 2016 first quarter. The decrease largely reflects expense reduction actions we implemented during the second and third quarters of 2016. The most significant decreases were in wages and benefits, marketing, product certification and professional fees.

The net loss for the 2017 first quarter was $1,104,000, $0.08 per share, compared to net loss of $903,000, $0.06 per share, in the first quarter of 2016.

At March 31, 2017, we had $1.3 million in cash, $9.3 million of net working capital and no outstanding funded debt.

https://www.sec.gov/Archives/edgar/data/1274032/000156459017010384/ifon-ex991_6.htm